Retiring before the state pension age is a goal for many; however, to do so, you need to have a watertight financial plan in place. The guaranteed income of the state provision forms the bedrock of post-work plans, so navigating without it can be expensive.
Ben, 62, is mulling this over. He retired in December 2024 after amassing a hefty personal pension. This is invested primarily in tracker funds with a handful of active ones too. He also has a healthy cash allocation, and an Isa which he uses as a testing ground for investments before buying them in his pension. However, at the moment the Isa also only holds trackers.
He plans to draw £48,000 per year after tax from his portfolio throughout his retirement, uprating this by inflation each year. This should cover everything from household bills, holidays and miscellaneous expenses such as car deposits to inheritance tax gifts and bigger-ticket items for friends and family.